Craig Roberts purchased one-half of Ennis Leighton's interest in the Vale and Leighton partnership for $34,000....
Craig Roberts purchased one-half of Ennis Leighton's interest in the Vale and Leighton partnership for $34,000. Prior to the investment, land was revalued to a market value of $130,000 from a book value of $80,000. Tony Vale and Ennis Leighton share net income equally. Leighton had a capital balance of $36,000 prior to these transactions.
Show your work.
- What accounting method is used to record the admission of Roberts?
- . Suggest an alternative method that could have been used to account for the admission of Roberts. Explain the difference.
Homework Answers
Admission of a partner
- Change in Profit Sharing rato
- Capital basis
- Goodwill Basis
- Bonus Method
Here robert is added as a pertner on Cpital Basis
Capital of Leighton = 36000 (Before Adjustment)
Revaluation Proft= $ (130,000 - 80,000) = $50,000
Capital Of leighton = 36000 + 50000 = $ 86,000
Capital of New Parter i.e Robert = $ 34,000
New Profit Sharing Ratio = 1:1
Add Answer to:
Craig Roberts purchased one-half of Ennis Leighton's interest in
the Vale and Leighton partnership for $34,000....
Do practice exercise 12-3A on page 613. Briefly explain your work. Suggest an alternative accounting method...
Do practice exercise 12-3A on page 613. Briefly explain your work. Suggest an alternative accounting method that could have been used to record the admission of Roberts into the firm. 12-3A Craig Roberts purchased one-half of Ennis Leighton’s interest in the Vale and Leighton partnership for $34,000. Prior to the investment, land was revalued to a market value of $130,000 from a book value of $80,000. Tony Vale and Ennis Leighton share net income equally. Leighton had a capital balance...
Craig Roberts purchased one half of Enni Leighton's interest in the Vale and Leighton partnership for...
Craig Roberts purchased one half of Enni Leighton's interest in the Vale and Leighton partnership for $33.750. Prior to th e land was evalued to market value of $1.290 from a book value of 573,830. Tony Vale and Enni Leighton share net income equally Leighton had a capital balance of 530 480 prior to these transactions Required: A On December 31, provide the journal entry for the revolution of land B. On December 31, provide the journal entry to admit...
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Craig Roberts purchased one half of Enni Leighton's interest in the Vale and Leighton partnership for $33.750. Prior to th e land was evalued to market value of $1.290 from a book value of 573,830. Tony Vale and Enni Leighton share net income equally Leighton had a capital balance of 530 480 prior to these transactions Required: A On December 31, provide the journal entry for the revolution of land B. On December 31, provide the journal entry to admit...
Book Show Me How Calculator Print om Revaluing and contributing assets to a partnership Instructions Chart of Accounts Journal Instructions Craig Roberts purchased one half of Envia Leighton's interest in the Wwe and Leighton parnership for $34.580. Prior to the investment, and was revalued to a market value of $156.730 from a book of $20.000. Tony Vale and Ennis Leighton share net Income qualy Leighton had a capital balance of $20,230 prior to these transactions Required A on December 31,...
The use of internal controls provides guaranteed protection against losses due to operating activities. * 2 points O True False 2 points Factors that cause the bank statement balance of a chequing account to be different from the business chequing account balance include: outstanding cheques, deposits in transit, deductions for bank fees, additions for interest, and errors. * True O False TechCom customer RDA Electronics paid off an $8,300 balance on its account receivable. TechCom should record the transaction as...
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